Interest Rate Decision Day

By Tom Higham

12th January, 2012

Today both the UK and the European central banks are announcing their latest interest rate decisions. Yesterday we saw Sterling weaken against the Euro as rumours started circling that the Bank of England will announce further Quantitative Easing (QE) today. On previous occassions when we have seen QE announced by the Bank of England it has caused Sterling weakness so should the rumours be confirmed today we could see the current Sterling Euro exchange rate highs dissapear very quickly. In the meantime there is still an outside chance that the European Central Bank could cut interest rates for the third month in a row which could cause some Euro weakness however this at present seems a little more unlikley than the QE in the UK. Either way this is possibly the first month for some time where the outcome of these meeting could go either way so if you need to transfer funds internationally make sure you speak to us today so we can discuss your requirements and all the options available to you.

We also saw Sterling weaken further against the US Dollar by 1.6% as the economic pressures on Europe continued to mean funds went into the safe haven US Dollar. While the economic problems continue in Europe and the UK it is likely that investors will continue to place funds in the Dollar which could mean this negative trend may continue. So, if you need to buy US Dollars speak to one of our experienced currency brokers so they can discuss your options which include a forward contract which allows clients to fix a rate of exchange at todays prices for a period in the future for just a small deposit. Call us today for more information 0800 328 5884 or email info@currencies.co.uk

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